SBA 7(a) Hotel Feasibility Study in Florida

Large loans and a franchise-heavy record

Hotel and motel lending in Florida under 7(a) is a cell of big tickets. SBA approved 352 loans between FY2017 and FY2026, worth $988.7 million, which puts the state sixth in the country for the class; hotels hold place 10 of 39 in the Florida class table. The median of $2.8 million is 1.29x the nationwide 7(a) hotel figure, with the central loans reaching from $1.2 million to $4.4 million. Franchised properties account for 62.2% of loans, so a brand is part of most of these files.

What distinguishes the Florida record

Florida hotel approvals dated FY2017 to FY2024 show cancellation of 8.8%, a figure that does not move when undisbursed loans are counted. For the 216 loans funded in FY2017 through FY2021, write-offs total 1.9% so far, with 0.93% inside the five-year window. Those are low floors, and the median is what sets this cell apart from hotels nationally. Still, a floor from loans that are open is only a minimum.

Lenders and counties

PromiseOne Bank has 28 loans, GBank 23, The MINT National Bank 20, Celtic Bank Corporation 16 and Readycap Lending, LLC 14. The lender is whoever SBA lists today, so the names are holdings and not a view of anyone's practice. Pinellas County has 33 loans, Duval 24, Orange 17, Osceola 16, and Broward and Volusia 15 each, so lending is spread over the Gulf coast, the northeast and the central tourism corridor, and no one metro dominates.

A swinging yearly record

Volume has moved a great deal: 66 loans and $198.5 million in FY2021, 15 loans in FY2023, 14 loans in FY2024, then 31 loans and $126.9 million in FY2026. A reader should avoid projecting any year forward.

The code

Hotels and motels are filed together, so a select-service flag and a full-service resort look alike here, and a boutique or extended-stay project cannot be picked out either.

Testing a Florida lodging project

The study must test demand by segment: leisure, business, group and the seasonal swing that defines Florida. It should show average rate, occupancy and revenue per available room against the competitive set, the franchise's fees and renovation requirements, and the property improvement plan. Operating costs and reserves for replacement of furnishings need to be explicit. Debt service coverage on a loan in the millions has to survive a storm closure and a slow season, and the appraisal will test the income by the going-concern approach.